Top Halliburton executive sips fracking fluid with colleagues in industry show stunt

Industry executives were in for an unusual treat during a luncheon presentation at the annual Quebec Oil and Gas Association this week in Montreal. Apart from his power-point slides, Halliburton Canada vice-president John Gorman’s served up samples of frack fluid in champagne bottles, encouraging his audience to take a swig of his company’s CleanStim blend.

“It was absolutely the first time I drank fracking fluid — you can be sure of that,” said Michael Binnion, President of QOGA and CEO of Questerre Energy Corp. a couple of days after Monday’s event, noting that 20 to 25 executives drank the brew. “I feel fine. There was quite a build-up, but it was a bit of a let-down as it was less viscous than I thought it would be, but more viscous than water. And very stale-tasting.”

Mr. Gorman, who drank the frack juice as well, said he was trying to make a point. “We were trying to show that whenever the oil and gas industry is shown a challenge, we view it as an opportunity to find solutions. And in this case, we only had to replace very few chemicals with some food additives.”

It’s not the first time Halliburton — one of the world’s largest oil services companies and a hydraulic fracturing pioneer — has pulled a frack-fluid-sipping stunt. In 2011, the company’s CEO Dave Lesar asked one of his executives to take a sip of the fluid during a presentation in front of industry executives. Critics wondered why the CEO did not drink it himself.

While the CleanStim fluid system consists of ingredients sourced entirely from the food industry it “is not intended for human consumption,” the company says. Halliburton’s overarching point is that if the fluid is good enough to enter the human digestive system, it’s safe to inject deep into the earth’s bowels.

“The purpose of drinking frack fluid is to say how one can in a dramatic way show people that their accepted wisdom on frack fluid disclosure is simply wrong,” Mr. Binnion said. “It is especially wrong today as more and more companies have joined in to disclose contents of the fluids.”

But there are many who are not drinking from the industry’s punch bowl.

Stephanie Merrill, director of freshwater protection program at the Conservation Council of New Brunswick, remains unconvinced about the safety record and success of fracking in Alberta, British Columbia and south of the border.

“I don’t believe when industry and government say that everything is okay in other jurisdictions — because that’s just not true. That’s not what we are hearing,” Ms. Merrill said in a telephone interview from her Fredericton office.

“In some places the industry is so far advanced that people can’t do anything about it…. But here in New Brunswick, we are ahead of the curve in terms of responding to a potentially threatening situation. We can nip it in the bud.”

Demonstrations against shale gas development erupted in New Brunswick this month as First Nation groups protested against SWN Resource Canada’s plans to explore for shale gas in the province.

Fracking, short for hydraulic fracturing, is a technique that uses high-pressure water and chemicals to extract oil and natural gas from underground rock formations. The method has been used widely across North America and, combined with horizontal drilling, has ushered in a shale oil and gas revolution in the continent.

But the practice is shunned in places like Quebec and France where governments worry about air pollution and contamination of water tables. This month, opponents organized a “Global Frackdown” with 250 events taking place across 30 countries.

A Pew Research Center survey in the United States in September also showed the public’s increasing anxiety over fracking. Almost half (49%) of those polled opposed the increased use of fracking — up frtom 38% people in a similar survey in March — while 44% were in favour.

The skepticism comes as the industry is making concerted efforts to change the ingredients used in fracking fluids and focusing on recycling the water it consumes.

“The oil and gas and oilfield services companies together have not done a good job in the past 10 years in defending or proposing solutions,” Mr. Gorman admits. “But now obviously it is in our best interest to say, ‘Look, here are some of the answers to the questions you had’. And we think we have done a good job and with data and with facts — not with rhetoric and rumour.”

Other companies are also developing chemicals that are either non-toxic or food-grade, says Kevin Heffernan, president of the Canadian Society of Unconventional Resources.

“It’s not going to taste very nice, but there is no risk associated with it. That’s something the industry has started to do in recognition of the public concern about hydraulic fracturing fluids.”

Halliburton’s Canadian clients have not taken up the CleanStim fluid system yet, but Mr. Gorman is hopeful that will change.

“We have used it in the United States — I would not say it is widespread. There is the issue that it costs a little bit more. Nobody wants to be the first to use it, but there are 100 companies that are willing to be second.”

Even without the drinkable innovation, Mr. Heffernan says the industry has an impressive track record with traditional fracking fluids.

“Public apprehension is really a fear of the unknown, which is triggering a lot of this [opposition]. The evidence that hydraulic fracturing does not contaminate ground water is pretty overwhelming when you think about the number of wells that have been hydraulically fractured in the U.S. or Canada over the last 50 years.”

On Wednesday, as it announced a new code of conduct that promotes best fracking practices, the Petroleum Services Association of Canada said more than 175,000 oil and gas wells drilled in Alberta and British Columbia since the 1950s have been stimulated using fracking with no evidence of drinking water contamination.

Meanwhile, efforts to launch frack-fluid disclosure websites that go in granular detail about each chemical used in each well have not placated critics who say the information on these online platforms is not comprehensive enough.

“I am pretty confident frack-fluid content disclosure rules are going to roll out across the country,” Mr Heffernan said. “It is already a regulatory requirement in British Columbia and Alberta, and in New Brunswick as well.”

The fracking debate has also been muddied and lumped in with other aboriginal complaints, especially in areas that have not interacted with the oil industry before, such as Rexton in New Brunswick, which was the site of police cars being set ablaze and arrests of dozens of protestors.

“The issue is layered and mixed with inherent First Nation issues,” Ms. Merrill said. “It is really hard to tease them out. The issue of shale gas and fracking has highlighted once again the challenges of our obligations under the treaty.”

But the industry feels that the New Brunswick protest’s violent turn has done little to create an environment that encourages healthy debate on fracking.

“It has been demanded of our industry that we engage in true consultation and real discussions with people,” Mr. Binnion said. “If those very people have demanded that of us, the violent protest that we saw in New Brunswick is not how people talk to each other. The industry works hard to change its culture, but we need to be rewarded for doing that — and to be talked to civilly.”